XML 37 R13.htm IDEA: XBRL DOCUMENT v3.21.2
Revenue Recognition
 6 Months Ended
Jun. 30, 2021
Entity Information [Line Items]  
Revenue Recognition Revenue Recognition
Revenue
The following are the significant categories comprising our reported operating revenues (in millions):
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Passenger revenue:
Passenger travel$5,995 $1,006 $8,888 $8,085 
Loyalty revenue - travel (1)
550 102 836 703 
Total passenger revenue6,545 1,108 9,724 8,788 
Cargo326 130 641 277 
Other:
Loyalty revenue - marketing services (2)
529 356 986 927 
Other revenue78 28 135 145 
Total other revenue607 384 1,121 1,072 
Total operating revenues$7,478 $1,622 $11,486 $10,137 
(1)Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions, which were earned from travel or co-branded credit card and other partners.
(2)During the three months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $684 million and $573 million, respectively. During the six months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $1.7 billion and $1.8 billion, respectively.
The following is our total passenger revenue by geographic region (in millions):
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Domestic$5,444 $1,026 $8,099 $6,806 
Latin America936 34 1,417 1,214 
Atlantic
125 42 147 565 
Pacific40 6 61 203 
Total passenger revenue$6,545 $1,108 $9,724 $8,788 
We attribute passenger revenue by geographic region based upon the origin and destination of each flight segment.
Contract Balances
Our significant contract liabilities are comprised of (1) outstanding loyalty program mileage credits that may be redeemed for future travel and other non-air travel awards, reported as loyalty program liability on the condensed consolidated balance sheets and (2) ticket sales for transportation that has not yet been provided, reported as air traffic liability on the condensed consolidated balance sheets.
June 30, 2021December 31, 2020
(In millions)
Loyalty program liability$9,306 $9,195 
Air traffic liability7,095 4,757 
Total$16,401 $13,952 
The balance of the loyalty program liability fluctuates based on seasonal patterns, which impact the volume of mileage credits issued through travel or sold to co-branded credit card and other partners (deferral of revenue) and mileage credits redeemed (recognition of revenue). Changes in loyalty program liability are as follows (in millions):
Balance at December 31, 2020$9,195 
Deferral of revenue983 
Recognition of revenue (1)
(872)
Balance at June 30, 2021 (2)
$9,306 
(1)Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period, as well as miles that were issued during the period.
(2)Mileage credits can be redeemed at any time and generally do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. In response to the COVID-19 pandemic, we suspended the expiration of mileage credits through December 31, 2021 and eliminated mileage reinstatement fees for canceled award tickets. As of June 30, 2021, our current loyalty program liability was $2.6 billion and represents our current estimate of revenue expected to be recognized in the next 12 months based on historical as well as projected trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter. Given the inherent uncertainty of the current operating environment due to the COVID-19 pandemic, we will continue to monitor redemption patterns and may adjust our estimates in the future.
The air traffic liability principally represents tickets sold for future travel on American and partner airlines, as well as estimated future refunds and exchanges of tickets sold for past travel. The balance in our air traffic liability also fluctuates with seasonal travel patterns. The contract duration of passenger tickets is generally one year. Accordingly, any revenue associated with tickets sold for future travel will be recognized within 12 months. For the six months ended June 30, 2021, $1.2 billion of revenue was recognized in passenger revenue that was included in our air traffic liability at December 31, 2020. In response to the COVID-19 pandemic, we extended the contract duration for certain tickets to March 31, 2022, principally those tickets which were scheduled to expire from March 1, 2020 through March 31, 2021. Additionally, we have eliminated change fees for most domestic and international tickets. As of June 30, 2021, the air traffic liability included approximately $1.6 billion of travel credits related to these unused tickets. Given this change in contract duration and uncertainty surrounding the future demand for air travel, our estimates of revenue that will be recognized from the air traffic liability for future flown or unused tickets as well as our estimates of refunds may be subject to variability and differ from historical experience.
American Airlines, Inc.  
Entity Information [Line Items]  
Revenue Recognition Revenue Recognition
Revenue
The following are the significant categories comprising American's reported operating revenues (in millions):
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Passenger revenue:
Passenger travel$5,995 $1,006 $8,888 $8,085 
Loyalty revenue - travel (1)
550 102 836 703 
Total passenger revenue6,545 1,108 9,724 8,788 
Cargo326 130 641 277 
Other:
Loyalty revenue - marketing services (2)
529 356 986 927 
Other revenue78 28 134 144 
Total other revenue607 384 1,120 1,071 
Total operating revenues$7,478 $1,622 $11,485 $10,136 
(1)Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions, which were earned from travel or co-branded credit card and other partners.
(2)During the three months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $684 million and $573 million, respectively. During the six months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $1.7 billion and $1.8 billion, respectively.
The following is American's total passenger revenue by geographic region (in millions):
 Three Months Ended June 30,Six Months Ended June 30,
 2021202020212020
Domestic$5,444 $1,026 $8,099 $6,806 
Latin America936 34 1,417 1,214 
Atlantic
125 42 147 565 
Pacific40 6 61 203 
Total passenger revenue$6,545 $1,108 $9,724 $8,788 
American attributes passenger revenue by geographic region based upon the origin and destination of each flight segment.
Contract Balances
American's significant contract liabilities are comprised of (1) outstanding loyalty program mileage credits that may be redeemed for future travel and other non-air travel awards, reported as loyalty program liability on the condensed consolidated balance sheets and (2) ticket sales for transportation that has not yet been provided, reported as air traffic liability on the condensed consolidated balance sheets.
June 30, 2021December 31, 2020
(In millions)
Loyalty program liability$9,306 $9,195 
Air traffic liability7,095 4,757 
Total$16,401 $13,952 
The balance of the loyalty program liability fluctuates based on seasonal patterns, which impact the volume of mileage credits issued through travel or sold to co-branded credit card and other partners (deferral of revenue) and mileage credits redeemed (recognition of revenue). Changes in loyalty program liability are as follows (in millions):
Balance at December 31, 2020$9,195 
Deferral of revenue983 
Recognition of revenue (1)
(872)
Balance at June 30, 2021 (2)
$9,306 
(1)Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period, as well as miles that were issued during the period.
(2)Mileage credits can be redeemed at any time and generally do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. In response to the COVID-19 pandemic, American suspended the expiration of mileage credits through December 31, 2021 and eliminated mileage reinstatement fees for canceled award tickets. As of June 30, 2021, American's current loyalty program liability was $2.6 billion and represents American's current estimate of revenue expected to be recognized in the next 12 months based on historical as well as projected trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter. Given the inherent uncertainty of the current operating environment due to the COVID-19 pandemic, American will continue to monitor redemption patterns and may adjust its estimates in the future.
The air traffic liability principally represents tickets sold for future travel on American and partner airlines, as well as estimated future refunds and exchanges of tickets sold for past travel. The balance in American's air traffic liability also fluctuates with seasonal travel patterns. The contract duration of passenger tickets is generally one year. Accordingly, any revenue associated with tickets sold for future travel will be recognized within 12 months. For the six months ended June 30, 2021, $1.2 billion of revenue was recognized in passenger revenue that was included in American's air traffic liability at December 31, 2020. In response to the COVID-19 pandemic, American extended the contract duration for certain tickets to March 31, 2022, principally those tickets which were scheduled to expire from March 1, 2020 through March 31, 2021. Additionally, American has eliminated change fees for most domestic and international tickets. As of June 30, 2021, the air traffic liability included approximately $1.6 billion of travel credits related to these unused tickets. Given this change in contract duration and uncertainty surrounding the future demand for air travel, American's estimates of revenue that will be recognized from the air traffic liability for future flown or unused tickets as well as American's estimates of refunds may be subject to variability and differ from historical experience.